Saturday, January 21, 2012

Losing Market Share

Pakistan will resume allowing supply shipments to NATO forces in Afghanistan. They halted them after a friendly-fire incident that left a couple dozen of their forces dead:

Pakistan expects to re-open supply routes to NATO forces in Afghanistan, halted after a NATO cross-border air attack killed 24 Pakistani soldiers in November, but will impose tariffs, a senior security official told Reuters Thursday.

But the supply lines won't last long as we shift to northern routes to avoid having Pakistan with their hands on the spigot (that we will be giving the spigot to Russia is another worry altogether, of course). So Pakistan will charge more money. What the heck, right? If they are losing the business anyway, why not get some money while they can, seems to be the thinking.

Money will be a problem for Pakistan. They soon won't have the ability to extort money for allowing supplies through--whether the extortion is official aid, tariffs, or the bribes needed to let the convoys go through safely. We shall see if the Pakistanis will alter their behavior toward the Taliban (in Afghanistan and in Pakistan) to more consistently help our war effort to keep the money flowing.

If they don't alter their behavior, we shall see how they seek alternate sources of money.